May 2nd, 2025
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The latest government profligacy heralded by billionaire Elon Musk's cost-cutting Department of Government Efficiency concerns hundreds of millions of dollars in specious unemployment claims it ostensibly unearthed.
A significant impediment presents itself: federal investigators have previously unearthed ostensibly identical fraudulent activity, years prior and of considerably amplified magnitude.
In a recent dispatch on X, the digital forum presided over by Musk, DOGE unveiled that an initial reconnaissance into unemployment insurance claims spanning the period since 2020 had unearthed astonishing irregularities: specifically, some 24,500 individuals exceeding the age of 115 had purportedly claimed benefits totalling $59 million; a further 28,000 claimants situated between the ages of 1 and 5 had purportedly amassed $254 million; and, perhaps most remarkably, 9,700 individuals with putative birthdates situated more than 15 years hence had ostensibly garnered $69 million in disbursements from state coffers.
The tweet elicited a predictable, partisan response of either scepticism or acclamation, not least from Musk himself, who characterised his team's findings as being of such abstruse complexity that he was compelled to re-peruse them sundry times before their import was fully apprehended.
The figures, he remarked with palpable disquietude, were unequivocally calamitous.
Nevertheless, Chavez-DeRemer need only consult her department's own Office of the Inspector General to ascertain that such fraudulent activities have already been documented by the very cadre of federal employees DOGE has disparaged.
"Their endeavour appears to be centred on constructing a discourse which posits governmental bodies as inherently inefficient and intellectually deficient, claiming to identify oversights purportedly missed by said entities," contends Michele Evermore, formerly engaged with unemployment matters at the United States Department of Labor during the tenure of the preceding administration under President Joe Biden. "They are purporting to uncover fraudulent activities that were already duly identified as such, and subsequently asserting their detection of these irregularities."
The 1935 Social Security Act codified unemployment compensation within the federal statutory framework, yet devolved to the individual states the responsibility for establishing mechanisms to levy unemployment contributions, adjudicate claims, and disburse benefits.
Notwithstanding the near-absolute gubernatorial authority over state unemployment infrastructure, ad hoc relief initiatives—particularly the substantively augmented provisions instituted by the nascent Trump administration during the initial phase of the COVID pandemic—introduce a more pronounced federal imprimatur and precipitate a significant ingress of novel claimants into the framework.
In non-exceptional periods, state unemployment systems exhibit a spectrum of efficacy, ranging from highly effective to profoundly inadequate, according to Stephen Wandner, an economist at the National Academy of Social Insurance and author of the seminal work "Unemployment Insurance Reform: Fixing a Broken System." However, with the COVID-19 pandemic's devastating impact on the economy and the resulting deluge of unprecedented claims that overwhelmed state capacity, Wandner contends that the performance of many systems deteriorated to an even more abysmal level.
Signed into law by President Trump on March 27, 2020, the COVID unemployment relief measure proved from its inception to be a potent magnet for fraudulent activity, with the Department of Labor issuing a cautionary memorandum to state officials barely two weeks later, highlighting the expanded benefits as having rendered unemployment programs acutely vulnerable to fraud, manifested in a significant volume of imposter claims leveraging stolen or synthetic identities.
The same memorandum proffered states an expedient by which to safeguard individuals whose identities had been pilfered for the purpose of illicitly procuring unemployment benefits. To meticulously document the fraudulent activity while simultaneously averting the entanglement of innocent parties, the memorandum counselled the institution of a "pseudo claim."
These purported claims instigated the recording of disbursements to individuals spanning the developmental stage of toddlerhood to the exceptional longevity of centenarians. While the Department of Labor's inspector general enumerated approximately 4,895 unemployment claims attributed to individuals exceeding the age of 100 during the period of March 2020 to April 2022, a subsequent departmental memorandum elucidated that these filings originated from states' alterations of birthdates, a measure implemented to safeguard the identities of those whose personal information had been compromised.
"A considerable proportion of the assertions pinpointed ... did not represent disbursements to centenarians, but rather constituted 'pseudo records' pertaining to previously substantiated fraudulent entreaties," the 2023 memorandum delineates.
A spokesperson for the Department of Labor remained conspicuously silent on inquiries concerning Musk's assertions, and the Department of Government Operations and Elections furnished no particulars regarding their purported discovery of fraud, nor whether their findings recapitulate or merely corroborate pre-existing revelations.
Although DOGE ostensibly examined a more protracted temporal expanse than had federal investigators heretofore, it amassed a mere $382 million in specious unemployment assertions, constituting an exiguous fraction of the sums already within the purview of investigative awareness.
In 2022, the Department of Labor posited suspected malfeasance concerning unemployment disbursements during the COVID-19 era approximated US$45 billion; subsequently, the Government Accountability Office averred the true figure was considerably more dire, likely ranging from US$100 billion to US$135 billion.
"I daresay this scarcely constitutes a revelation to anyone," posits Amy Traub, a preeminent authority on the vagaries of unemployment at the National Employment Law Project. "Its pervasive presence within the public consciousness has been amply documented, underscored by a plethora of congressional deliberations."
Should DOGE's most recent asseverations strike a note of déjà vu, it is due to their reiteration of its preceding pronouncements concerning Social Security disbursements to deceased and extraordinarily aged individuals, which were ultimately determined to be spurious claims.
Consequently, DOGE proves to be an inadequate conduit of communication even in instances of substantiated malfeasance, such as those pertaining to unemployment benefit assertions.
Jessica Reidl, an eminent senior fellow affiliated with The Manhattan Institute, a conservative think tank, exemplifies a staunch fiscal conservatism, advocating with such fervour for the eradication of federal profligacy that her oeuvre on the topic extends to some six hundred articles; however, whilst harbouring a profound conviction regarding the pervasive nature of unemployment insurance fraud, she nonetheless regards the pronouncements emanating from DOGE with considerable circumspection, asserting the latter's track record is characterised by demonstrable ineffectuality and potential legal impropriety.
"I become sceptical when DOGE posits that vast numbers of incredibly superannuated defunct individuals are drawing unemployment benefits," Reidl asserts, "given DOGE's historically less-than-sterling performance in that particular domain."
Traub stated the eruption of pandemic-era unemployment malfeasance prompted states to institute novel security protocols, posing the query as to why Musk's cohort was heralding stale chicanery as if it were a recent development.
"Given the foreboding prognoses of a national recession emanating from business leaders and economists, contemplating unemployment is a natural corollary," Traub observes, positing further that "this constitutes an assault on the very image of a critically vital program and, perhaps, a stratagem to erode public favour for unemployment insurance precisely when its salience is at its zenith."
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